Did Americans not know we were running up massive debt over the last 10 years? Was everyone just ignoring all the bad numbers because of . . . well, what exactly?
I’m thrilled that average Americans are now concerned about the long-term sustainability of federal spending in America, but I’m kind of mystified by a) the sudden interest in a problem that we’ve had for decades and b) the desire by some to blame the current administration for the problem.
I’ve been writing a lot about the historical context for the debt, and I’d highly recommend a piece from today’s Washington Post: Running in the red: How the U.S., on the road to surpluses, detoured to massive debt.
The nation’s unnerving descent into debt began a decade ago with a choice, not a crisis.
In January 2001, with the budget balanced and clear sailing ahead, the Congressional Budget Office forecast ever-larger annual surpluses indefinitely. The outlook was so rosy, the CBO said, that Washington would have enough money by the end of the decade to pay off everything it owed.
Voices of caution were swept aside in the rush to take advantage of the apparent bounty. Political leaders chose to cut taxes, jack up spending and, for the first time in U.S. history, wage two wars solely with borrowed funds. “In the end, the floodgates opened,” said former senator Pete Domenici (R-N.M.), who chaired the Senate Budget Committee when the first tax-cut bill hit Capitol Hill in early 2001.
Now, instead of tending a nest egg of more than $2 trillion, the federal government expects to owe more than $10 trillion to outside investors by the end of this year.
There is much more in the piece.